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CALLING THEIR BLUFF
Well, that escalated quickly …
Apparently, PG&E wasn’t kidding when it said it’d be filing for bankruptcy should the state of California leave it high and dry and refuse emergency government assistance to help cover the $30B in liabilities stemming from the most costly wildfires in California history. In fact, yesterday PG&E announced its intentions to declare for bankruptcy protection by the end of the month.
For what it’s worth PG&E’s equipment has been identified as a source of some of the blazes so California bailing them out would be like a pedestrian who got hit by a drunk driver paying for damage to the car … or something like that.
And just when you thought it couldn’t get any worse, on Sunday PG&E CEO Geisha Williams announced that she’d be stepping down with a $2.5M parting gift (read: severance), despite overseeing the entire debacle.
That doesn’t seem like good news …
It’s not, especially if you’re a PG&E customer. The bankruptcy filing could come with higher bills for customers, according to reports.
As for PG&E? State senators and regulators in California are blaming piss poor record keeping as a cause of the recent issues the company has faced, so the worst could very well still be yet to come.
Despite luxury brand’s notable absences from the Detroit Car Show and the general lack of enthusiasm for going to Michigan in January, Volkswagen took the opportunity to make some big announcements. The German Automaker publicized plans that it will be investing $800M in its US facilities as Das Auto increases its electric vehicle output.
The plant, located in Chattanooga, TN is adding 1k jobs and will begin making EVs in 2022. The masterminds behind diesel-gate are also considering building some of their Audi brand vehicles in the U.S but have not committed to that just yet.
Thanks to that whole emissions scandal and increasing trade pressure from the US, it was only a matter of time before VW put its tail between its legs and did the land of the free and the home of the brave a solid.
Also on the docket? The company will forge a global alliance with Ford. While both companies have their own respective electric dreams, a partnership will help shoulder the development costs. The firms haven’t dropped the deets of the global alliance just yet, but look out for a presser this AM.
NEW-MONT, WHO DIS?
The d*ck measuring contest between Newmont Mining and Barrick Gold just went nuclear. Newmont leapfrogged Barrick, which recently scooped up Randgold for $6B, with its $10B all-stock deal for Goldcorp. Real original name, you guys.
Newmont will pay a 17% premium to Goldcorp’s closing price as part of the all-stock deal. And in what can only be chalked up as a gift masterminded by Midas himself, Newmont’s CEO, whose name is, wait for it … Gary Goldberg, will remain at the helm of the new firm.
Newmont does own another distinct advantage over its rival: most of its troy ounces are of the conflict-free variety. With more than 75% of its resources in the Americas, Newmont has done its best to distance itself from blood-gold, unlike rival Barrick whose reserves lie in Africa and other places that don’t give foreign tourists that warm and fuzzy feeling.
Gold ain’t what it used to be. From its peak in 2011, gold has fallen more than 30%. Coupled with increased extraction costs and depleting reserves, the business isn’t as lucrative as pseudo-reality television would indicate.
If you thought consolidation was out of control in the big pharma space, hold onto your pickax, you gold digging SOB. With Newmont’s purchase of Goldcorp, bullion bulge brackets are few and far between. The street is, however, littered with smaller, boutique players.
IN OTHER NEWS
- Three months ago thousands of Google employees staged a walkout in protest of Android creator Andy Rubin being presented with a $90M exit package in 2014 after credible sexual harassment claims were brought against him. Fast forward to today (literally), the same Google employees that organized the protest plan to launch a social media campaign to raise awareness of forced arbitration in the tech industry. From 9 PM to 6 PM they will share stories and interviews on Twitter and Instagram.
- It’d be a lot cooler if you did. Yeti Holdings shares jumped 15% yesterday after surpassing analysts expectations with an impressive 19% sales increase. This was its biggest intraday gain since the company’s IPO in October.
- Apparently, it’s ‘frowned upon’ to do business with corrupt individuals that are in the pockets of government officials from the Democratic Republic of Congo. Glencore must’ve missed that ethics course, having given nearly $1B in loans to companies of an Isreali businessman that was involved with said officials, over a ten year period. The Isreali businessman, Dan Gertler, was sanctioned by the US Treasury Department in 2017 for his relationship with Congo President Joseph Kabila.
- Canada based Aurora Cannabis announced that it intends to purchase Whistler Medical Marijuana via an all-stock deal worth $175M. Whistler, which is a certified organic cannabis producer, operates in both the medical and recreational markets. The pot peddler has been cash-flow positive since 2015 and has EBIDTA margins above 30%. Devil’s lettuce is so hot right now.
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